by the way, the full project is only 2 minutes and 40 seconds.
Beyond that, simply differentiate between intermediary formats vs. delivery formats vs. the native working format of edit programs. Neither has anything to do with the other and they all require specific settings and procedures of their own. Formats like WMV and H.264 work well for desktop review, but that does not mean you would use them in your edit suite because they might not play at al lthere or the program still convert them to its native format. Same happens with your QT file or AVI. Anyway, this is an endless topic and I suggest you do a bit more generic research on the web.
> What the end result is going to be is on a DVD playing on a 16:9 TV. It doesn't necessarily need to be HD although it appears my project is.
First of all, note that DVD video is not HD. DVD video is a very narrow specification for SD video (using MPEG-2 video). If you're creating video for DVD, then you choose the MPEG-2 DVD option from the Format menu in the output module settings .
For information about choosing output settings, see this page and all that it points to.